What changed
The City of Austin's HOME code changes, effective in 2024, allow up to three housing units on most single family zoned lots, and a second phase reduced the minimum lot size for new homes. The city also removed minimum parking requirements in 2023, which removed a common obstacle to garage conversions and backyard units.
Three ways to add a unit
- Garage conversion: often the lowest cost per unit because the slab, walls and roof exist. Plumbing is cut into the slab, and the old door opening becomes a wall with a window or entry.
- Detached ADU: a separate small house in the backyard; the most private for tenants and the most flexible to design.
- Internal split or attached unit: dividing a large house or adding an attached unit, with fire separation between units.
What still decides whether it works
- Impervious cover, setbacks and height limits for the lot.
- Protected trees (19 inches or more in diameter) and their root zones.
- Private deed restrictions and HOA covenants, which the city does not override.
- Utilities: electric service capacity, and water and wastewater connections and their fees.
- Floodplain status, which can rule out new living space.
Permits and timeline
In Austin, a new unit goes through the New Construction or Addition application, with a 10 business day review for each cycle under the city's stated review times, and the city offers zoning appointments for ADU questions. Our ADU permit guide covers the documents, fees and approval tips in detail.
Running the numbers
Compare the cost of the new unit, including utility work and permits, with the rent it can earn and any change to property taxes and insurance. Talk with your lender, accountant or financial advisor about financing and tax treatment; this guide is general information, not financial advice.
Related services
This guide is general information, not legal or engineering advice. Rules change; we confirm them for your address during the free consultation.